There is a lot in this update that engineers will care about. Some of it is genuinely good news. Some of it is the same language we have been reading for two years. And a few things are missing that should not be.
The federal government tabled its Spring Economic Update (SEU) this week, one year into Prime Minister Mark Carney’s mandate. Finance Minister Francois-Philippe Champagne delivered the statement in a political environment shaped by U.S. trade pressure and growing public impatience with the pace of infrastructure delivery. The government’s answer, broadly, is to build more and faster, while spending with more discipline than past budgets suggested.
OSPE went through the document looking for what it means for the engineering sector specifically. Here is what stood out.
WORKFORCE
The workforce commitment is real, and it is not enough on its own
The government’s big workforce number is 80,000 to 100,000 new Red Seal tradespeople by 2031, with more than $6 billion behind it. Red Seal is Canada’s national certification for skilled trades, the electricians, welders, plumbers, and carpenters who turn engineering drawings into actual buildings and infrastructure. When that workforce is short, projects sit. It does not matter how good the engineering is.
This money is not going to engineers. Trades and engineering are separate pipelines with separate licensing frameworks, and this budget does not touch the engineer shortage. But that is not the whole story.
Policy Win: Ontario infrastructure projects have been stalling not because there are not enough engineers, but because there are not enough licensed tradespeople to do the physical work. Fixing that bottleneck benefits everyone in the sector, including engineers who have watched well-designed projects sit in limbo waiting for construction crews.
What the update does not do is address the engineering workforce directly. Internationally trained engineers still face slow, inconsistent credentialing processes that prevent qualified professionals from contributing to Ontario’s workforce at the level they are capable of. A national licensing framework would give Canada’s licensed professional engineers the mobility and recognition to work across provincial borders without unnecessary duplication, strengthening Canada’s engineering capacity at a time when delivery timelines cannot afford delays. OSPE will keep pushing on this front, because the trades investment and the engineering workforce gap are two separate problems that both need solving.
HOUSING AND INFRASTRUCTURE
Code modernization finally gets funding
The SEU puts $41.9 million over five years toward modernizing the National Model Codes and reducing regulatory friction between jurisdictions. In practice, that means eliminating duplicative inspections, creating clearer pathways for modular and panelized construction, expanding code flexibility for engineered wood, and speeding up approvals for prefab products.
Policy Win: This one has been on the list for a long time. Inconsistent code interpretation across provinces has been a recurring frustration for engineers working on housing and construction projects. Funding the Standards Council of Canada and the NRC to actually fix this is a meaningful step.
The government also commits $7 billion in low-cost CMHC loans for up to 16,500 new rental homes, a 30-day consultation on mortgage insurance flexibilities, and signals toward modernizing mortgage products to match G7 norms. These are sensible moves. The missing piece is timelines. The SEU is clear on intent but vague on when any of this actually takes effect.
ENERGY AND CLIMATE
One step forward on the grid. Still waiting on nuclear.
The government will release a discussion paper on grid modernization, seeking input from provinces, territories, and Indigenous partners on how to connect and expand the electricity system. Ontario engineers have concrete things to say about transmission buildout, storage integration, and how sector coupling between electricity and thermal systems can reduce costs for consumers.
Policy Win: A federal discussion paper on grid modernization is exactly the kind of process where engineering expertise should be shaping the options, not just commenting on them afterward. OSPE intends to engage substantively.
On nuclear, OSPE advocated in its 2025 federal pre-budget submission for investment in nuclear as a high-potential sectors that can drive innovation, employment, and export growth when powered by engineering excellence. The federal government is still promising a National Nuclear Energy Strategy is coming soon. It said the same thing in Budget 2025. At some point “near- to medium-term” stops being a timeline and starts being a placeholder.
The strategy covers the full nuclear sector, large reactor refurbishments, new builds, the works. But the piece of the industry that cannot afford to keep waiting is small modular reactors (SMRs). SMR developers are making real investment decisions right now: whether to move forward in Canada, or take their projects somewhere with clearer rules. A federal strategy with no release date is not an answer to that question. It is a deferral.
The SEU expands the Carbon Capture, Utilization, and Storage (CCUS) tax credit to cover enhanced oil recovery, with rates ranging from 18.75% to 30% depending on the type of equipment. The catch is that projects have to permanently store the CO2 they capture, which sounds straightforward but will raise real questions when engineers start applying for eligibility.
OSPE will be tracking how the implementation guidance takes shape and will share analysis for members working in this area when there is something concrete to say.
COMPETITIVENESS AND PROCUREMENT
A procurement reform signal, but engineers are still waiting for QBS
The government announces a Whole-of-Government Competition Plan and a new Small and Medium Business Procurement Program to launch this spring. The goal is to lower the barriers for Canadian firms competing for federal contracts. That is worth watching.
What is not in this update: any movement on qualifications-based selection for engineering services.
QBS is the procurement model that selects engineering firms based on technical merit before negotiating fees, rather than awarding contracts to the lowest bidder. It produces better outcomes and is standard practice in much of the G7. Canada has been slow to adopt it at the federal level. OSPE will be raising this directly in the Competition Plan consultations.
The SEU confirms no new domestic content requirements for the Clean Technology and Clean Electricity Investment Tax Credits, and no bonus credit rates for projects that use Canadian-made equipment or materials. The consultation on this closed in March. Some in the engineering and manufacturing sector were hoping the government would use the tax credit structure to send a stronger Buy Canadian signal. That did not happen.
CAPITAL AND MAJOR PROJECTS
The Canada Strong Fund: the right idea, details still to come
The Canada Strong Fund will take minority stakes alongside private capital in Canadian projects and companies, with a dedicated Transition Office standing up to finalize the structure and engage market participants. The Major Projects Office is expected to play a role in identifying eligible projects, though it receives no new funding in this update.
For engineers on major projects, the questions that matter are practical ones: which projects qualify, what does the application process look like, and how long does it take. The SEU answers none of those yet. The Transition Office engagement process is the next place to watch, and OSPE will be asking for technical representation in it.
WHAT WE ARE STILL WATCHING
Budget 2026 in the fall is where the bigger funding decisions will land. A few things from this update are worth flagging now:
- AI governance: The National AI Strategy gets six pillars named but no timeline and no detail. Engineers in AI-adjacent fields, and there are a lot of them, need to know what the regulatory framework will look like before they can plan projects or manage liability exposure. OSPE submitted a set of recommendations for AI governance in November to inform the national strategy across research and talent, adoption, commercialization, scaling, safety, skills, infrastructure, and security.
- Nuclear timeline: The SMR sector is not going to wait forever for a strategy. Every month without a federal timeline is a month of investment uncertainty.
- Execution: The government is also cutting its workforce by 15%. Building out a major capital agenda while shrinking departmental capacity is a management challenge that deserves more scrutiny than it is getting. Project delivery does not happen without people to manage it.
The SEU is a government showing it understands the problem. Canada needs to build more, faster, with better-trained workers and less regulatory friction. On those counts, this update moves in the right direction. Whether the dollars translate into projects in the ground is a different question, and that is what OSPE will be watching through Budget 2026 and beyond.
These are the processes where engineering expertise needs to be present. OSPE will be pursuing engagement on each front and will keep members updated as those conversations develop.
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